At the Budget, earlier this year, the Government banned only solar and wind investments, however the latest move will affect hydro and anaerobic digestion as well.

Stellar Asset Management chief executive Jonathan Gain says the “most likely scenario” – which happened last time – is that the rules will apply only to new money invested in the 2015-16 tax year.

“Which will mean anyone with renewable-based EIS or VCT structures in place has just four months to raise the funding and invest,” he explains.

“Expect to see products pulled.”

The ambiguous wording in the statement could that existing EIS and VCTs could be shorn of their double tax breaks for renewable investments, he adds.

“Between £500m and £1bn is invested within renewables through tax strategies like EIS, SEIS and VCT.

“The worst case scenario – and we won’t know this till the draft legislation is published – is that rules will be applied retrospectively and the benefits will no longer apply to money already invested, which will create a furore.”

Triple Point principal Ben Beaton says he is confident investors will not be affected by the changes.

”We identified hydro as an attractive renewable energy proposition over four years ago and as such we have already completed all the necessary due diligence with six schemes now under construction,” he says.

“Consequently Hydro VCT investments will be made ahead of the 6 April deadline, ensuring investors are able to support the development of this portfolio of hydroelectric projects.”